Local solution to global food safety challenge

Local solution to global food safety challenge

Like the rest of the world, New Zealand businesses face significant challenges around sustainability, food safety, health and safety and marketing. In this second in a series of articles, KPMG partner Matt Prichard argues we should look to tikanga Māori to find rich, unique, New Zealand solutions that can give us an advantage on a global stage.

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Partner, Head of Wealth Management

KPMG in New Zealand

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Maori oars

The contribution of Māori business to New Zealand’s prosperity is one of the most exciting opportunities of our generation.

If mainstream New Zealand business takes the time and builds relationships of trust, KPMG believes there’s a huge amount to be gained for all New Zealanders from looking inside Te Ao Māori for solutions to some of our biggest challenges.

Earning more from the food we already export

Much of our economic prosperity comes from our ability to nourish the world with high quality, trusted food. Our government has set us all the challenge of doubling the value of New Zealand’s exports by 2025.

  • increasing global commodity prices
  • increasing production volumes
  • owning more of the global value chain and capturing more of the price the end consumer already pays for our stuff.
Both recent experience and analysis of very long-term time series data indicates we’d be nuts to bet the farm on sustained growth in commodity prices.
 
KPMG does believe that there is substantial opportunity over the next decade for growth in food export volumes from irrigation infrastructure and smart-science being applied to both growing and processing.
 
But by far the biggest opportunity we see is from New Zealand businesses controlling more of the food value chain and capturing more of the total price the world’s people are prepared to pay for our food.
 
So what will they pay for?

Food safety pays

Lincoln University’s Agribusiness and Economics Research Unit published a report on consumer behaviour and trends for “credence attributes” last year that focused on New Zealand’s key markets, and the willingness of those customers to pay for product features that are not physically observable or experienced at the point of consumption.

Examples of credence attributes include food safety, country of origin labelling, traceability, local food, recyclability and eco-packaging, eco-labelling, environmental quality, carbon labelling and reduction, organic, GM-free products, animal welfare, biodiversity and fair trade.

Their study showed that, for example, Chinese and Indian consumers were willing to pay more than a 70 per cent premium price for trusted food safety. This was far more important than other intangible attributes in both our dairy and meat exports to those consumers.

We know the global consumer is already demanding the highest standards of food safety throughout the supply chain. We also know the risk we run if the consumer loses trust in our ability to control the safety of their food.

A mainstream response

Our mainstream response is rules based. Everyone wants to deliver safe food, but regulation and inspections are the necessary regulatory response to the risk to our collective reputation from a failure by an individual business.

The average lamb is processed into around 70 parts, and exported all over the world. Dairy processing was once described to me (by a plant manager) as similar to oil refining – the natural stuff from the cow is methodically broken down into its components to be made into everything from cheese to plastic.

Thousands of pages of New Zealand legislation and regulation govern aspects of the supply chain between the grower and the eventual consumer of our food. Layer on that, many more thousands of pages of Overseas Market Access Requirements applied by destination countries.

Enforcing the rules requires a small army of inspectors and testing agencies in our businesses, and at the borders and the markets in the countries we export to.

All of this process and control is needed to protect our industry. But all of it is only as strong as the people who operate it. So our food businesses face the challenge of building food safety deeply into the culture of their teams.

Mauri Ora

Māori believe that the land holds an essential life force – its mauri. That vital essence is transferred into the grass and other plants that grow on the land, and becomes part of the animals who consume them. It connects us individually to the land, the environment and each other.

The philosophy of Mauri Ora (the healthy life essence) offers us a much deeper, richer approach to embedding food safety into the culture of our food businesses.

Culture is a much deeper driver of behaviour than process. It drives our purpose and values, and motivates people to do things because they truly believe in the reason for doing them.

The concept of Mauri Ora gives our foodproducing companies the opportunity to teach their people that their roles are about preserving the mauri that lives within our food products, so that it is alive and well when it is consumed by an infant or a pensioner in Beijing, Mumbai or London.

It is a simple belief that captures all New Zealanders’ connection to the land, and their good understanding of the direct link between the health of the land and waterways and the healthy food we produce from them.

Consider the stark contrast between the plant manager comparing his handling of food to oil refining, and the concept of caring for and preserving an essential life force.

This layer of culture doesn’t mean we could retire the rules or the inspectors. But giving people a passionate belief that supports their roles will always beat a pure process and controls approach.

Embedding this basic Māori philosophy in our food exporting businesses can be the basis for a unique advantage on the world stage.

© 2017 KPMG, a New Zealand partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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